3I0-012

3I0-012 practice questions, page 26 of 30, with answer review and explanations.

Question 126

Today, you sold 10 December EURODOLLAR futures contracts at 99.50. The closing price is fixed by the exchange at 99.375. What variation margin will be due?

  1. You will have to pay USD 312.50
  2. You will receive USD 312.50
  3. You will have to pay USD 3,125.00
  4. You will receive USD 3,125.00

Question 127

What is a short straddle option strategy?

  1. A long call option + long put option with the same strike prices
  2. A short call option + short put option with the same strike prices
  3. A long call option + short put option with the same strike prices
  4. A short call option + long put option with the same strike prices

Question 128

What is the probability of an ‘at-the-money’ option being exercised?

  1. Less than 50% probability
  2. 50% probability
  3. More than 50% probability
  4. Zero probability

Question 129

What is a short strangle option strategy?

  1. A short call option + long put option with a higher strike price than the call option
  2. A long call option + long put option with a lower strike price than the call option
  3. A short call option + short put option with a lower strike price than the call option
  4. A long call option + long put option with higher strike price than the call option

Question 130

A euro zone-based bank that is asset-sensitive to market interest rate changes might reduce interest rate risk by:

  1. entering into a pay fixed I receive variable standard interest rate swap
  2. entering into a receive fixed I pay variable standard interest rate swap
  3. entering into a pay fixed / receive variable amortizing interest rate swap
  4. entering into a GBP/USD FX swap